A leader in the field of motion control with a global layout
The company focuses on manufacturing key components for three types of products: control motors and their drive systems, power and lighting system controls, and equipment status management systems, and lays out the global control motor market through “endogenous innovation+epitaxial acquisition”. In 2022, revenue was 2.96 billion yuan, up 9% year on year, and net profit to mother was 250 million yuan, down 11.6% year on year. It is expected to return to a high growth rate after production capacity is released, with overseas revenue accounting for 48% and gross profit margin 43% in 2022.
Demand for traditional motors has improved marginally. Mainstream motors, which are leading control motors, are mainly rotating motors, which are widely used in high-end downstream applications such as industrial automation, medical devices, mobile service robots, and photovoltaics. The market size is large; the development trend of high quality, high performance, and intelligence is clear, and demand in emerging fields will maintain a high growth rate. The company formed a complete motion control product matrix, gradually broke the monopoly of Japanese companies in the field of stepper motors, and became the leader in the hybrid stepper motor industry. The company acquired companies such as AMP, LIN, Transportation Control Electronics, T-Motion, etc., to form complementary technology upgrades around its core business and lay out a global service network. In the first half of 2023, the Taicang base completed the relocation work. The Vietnam base was put into mass trial production, and the production capacity layout further enhanced the company's global competitiveness.
The labor gap has spawned space, and hollow cup motors create long-term value. Under embodied intelligence, application scenarios for humanoid robots continue to expand, and the certainty of implementation is getting stronger and stronger. The global workforce continues to run out, with 4.26 million units in 2030 (replacing 5% of the global labor gap of 85.2 million) in terms of filling the labor gap; from the perspective of potential replacement industries, the global demand space is 4.31 million units (optimistic estimate) and 2.83 million units (pessimistic estimate). The hollow cup motor module scheme is more suitable for dexterous hands. The global competition pattern is concentrated, and domestic manufacturers have more potential to reduce costs. According to the initial unit price of 1,000 yuan, mass production of 1 million units is 600 yuan. The market space driven by humanoid robots in 2025/2030 is expected to be 12/87 billion yuan.
Profit forecasting and investment advice
We expect the company's net profit to be 1.4/2.5/380 million yuan in 2023-2025, with year-on-year increases of -8%/24%/28%, respectively. The PE valuation corresponding to the current stock price is 107.4/58.7/38.5 times, respectively. The company was given 65 times PE in 2024, corresponding to a target price of 38.46 yuan/share. For the first time, coverage was given a “holding” rating.
Risk warning
The degree of commercialization of humanoid robots falls short of expectations; risk of fluctuating demand in the downstream market; risk of deteriorating international trade environment; risk of capacity release falling short of expectations; measured subjective risk.